According to ABI Research, this will open up a multitude of opportunities for service providers and data aggregators to exploit travelers' desires for contextual information about local services and points of interest.
Principal analyst Dan Benjamin says, "To differentiate themselves, navigation vendors will have to find other and better data to incorporate into their navigation schemes. That will involve a connection to the Internet."
Companies such as TomTom and Dash Navigation are already blazing the trail here: TomTom uses Bluetooth to establish the pipeline to the extra data, while Dash is using a cellular modem and Wi-Fi.
Next-generation devices, set to appear in the next few months, will offer traffic flow data, weather information, or instant messaging. Within two years, we may see navigation systems providing contextual answers to highly specific queries about local products and services.
"Navigation vendors," says Benjamin, "should be partnering with various data suppliers in order to differentiate their offerings and incorporate the new data into their routing algorithms and applications. There are also many opportunities for data aggregators in niche areas."
But it's not quite that simple. Not only are business models still poorly defined in this sector, but to realize this potential, providers must work to standardize the data so it is "digestible" by a wide variety of navigation devices.
Paradoxically, handset-based devices, which have been inferior with regard to the navigation experience due to their small form-factor, will have an advantage in the era of "connected navigation" because they already have cellular connections. Make them work outside the vehicle, and they open up a whole new market: the urban pedestrian.
